A recent rash of false advertising lawsuits should remind all businesses of their obligation to keep their advertising honest.
In one case, Vibram agreed to pay $3.75 million to consumers because it could not give scientific evidence to back up its claims that its running shoes delivered the health benefits its ads promised. Red Bull is paying out $13 million for unverified claims that its energy drinks delivered more health benefits than coffee or caffeine pills. And U-Haul was slapped with a lawsuit because it didn’t include an additional “environmental fee” in the advertised price of renting its vehicles.
The Federal Trade Commission Act and other laws require businesses to keep their advertising truthful and non-deceptive. Businesses must be able to back up any objective claims they may about their products and services with sufficient evidence.
False advertising not only hurts consumers, it can also hurt other businesses that buy from a company that’s stretching the truth.
Businesses and consumers can identify false or misleading advertising by asking the following questions:
• Can the company back up any claims it makes about the health, safety or other benefits of using its product?
• Does the company make claims that are difficult for consumers to verify, such as the environmental impact of using a product?
• Even if a claim is technically true, is it surrounded by misleading images or text?
• Is the company charging higher prices for its products compared to its competitors based on its advertising claims?
Both consumers and businesses can file complaints or class action lawsuits with the Federal Trade Commission if they believe a company’s advertising has been deceptive or misleading.
— Robert N. Peirce III, Robert Peirce & Associates, email@example.com
Business workshop is a weekly feature from local experts offering tidbits on matters affecting business. To contribute, contact Business Editor Brian Hyslop at firstname.lastname@example.org.